Kuala Lumpur, 17 March 2018,
RHB Research is positive on food and beverages chain operator, Berjaya Food Bhd, on the back of sustainable growth driven by Starbucks through expansion of outlets and better consumer sentiment moving forward.
The research house also said it expected Kenny Rogers Roasters Malaysia (KRRM) to return to the black in financial year 2019 (FY19) as a result of new strategies, which had given the franchise a new lease of life and attracted more footfall at its outlets.
“Meanwhile, Berjaya Food is to fully stop consolidating the losses from Kenny Rogers Roasters Indonesia (KRRI) in fourth quarter FY18, following the completion of its disposal.
“The completion of KRRI’s disposal will be positive to Berjaya Food as it has been a drag on both sentiment and earnings,” it said in a report on Friday.
RHB Research said all of these steps supported its three-year net profit compound annual growth rate forecast of 38 per cent.
“We maintain our ‘buy’ call, with a higher target price of RM2.18 from RM2.16, a 19 per cent upside,” it said.
However, RHB Research said, possible risks to its recommendation included a slower-than expected turnaround in KRRM and weaker-than-expected same store sales growth.
At lunch break, Berjaya Food’s share price in Bursa Malaysia eased eight sen to RM1.75 with 241,800 shares traded. – Bernama
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